India: Imported aluminium scrap prices remain range-bound w-o-w amid year-end uncertainty

• Automakers gear up for maintenance shutdowns
  
  
• Global sellers shift focus to Thailand, Malaysia for few specific grades.
  
  

Imported aluminium scrap prices in India remained range-bound w-o-w, with variations by up to 2%, amid slow trading activity, which has caused market uncertainty towards the year-end.

BigMint's benchmark assessment for Tense scrap originating from the UAE stood at $1,800/tonne (t), firm w-o-w, while Zorba 95/5 from the UK was at $2,110/t, largely stable w-o-w, both CFR west coast, India.

This week, London Metal Exchange (LME) prices dropped marginally by around 0.9% to $2,587/t. Meanwhile, stocks at LME-registered warehouses stood at 681,600 t, falling by around 9,000 t w-o-w from 690,700 t.

Market scenario

Demand for aluminium scrap picked up slightly this week, with some buyers securing material for shipments scheduled for January-February. Indian demand for UAE-origin Taint Tabor also increased, with recent transactions recorded at $2,160-2,180/t.

Meanwhile, China's silicon demand softened due to surplus inventories held by alloy manufacturers, which continued to weigh on prices. Additionally, Zorba imports into India were limited, as sellers prioritised Southeast Asian markets, where better price realisations are being achieved.

A market insider highlighted that Thailand and Malaysia are emerging as lucrative destinations for Zorba, offering a premium of $60-70/t over Indian prices. With higher returns and reduced shipping costs, global sellers are increasingly shifting their focus to these markets and other Far East regions to maximise profits. Meanwhile, Indian buyers are purchasing Zorba at lower levels of around $2,100/t, though they recently increased their bids by $10-20/t, according to sources.

Domestic scrap tags inch up

In the domestic market, Tense scrap prices were up slightly by INR 1,000/t in both Delhi and Chennai, while other grades also witnessed an uptrend. According to BigMint's assessment, domestic Tense scrap stood at INR 174,000/t ex-Delhi-NCR and INR 175,000/t ex-Chennai.

Automotive companies are gearing up for maintenance shutdowns, which is further dampening demand. However, year-end restocking led to a slight uptick in prices, though they are expected to remain range-bound.

China's silicon prices edge down

According to BigMint's assessment, prices of China's 553-grade silicon dropped by $50/t w-o-w to $1,680/t CFR Mundra. Freights were at around $2,000-2,300 for a single container from China to Mundra.

Outlook

The aluminium market faces significant uncertainty. A bauxite shortage is driving up alumina prices, while supply concerns persist due to China's 13% export tax rebate removal, which could impact Asian buyers. Additionally, Western suppliers are preparing for extended winter holidays starting, say, 15 December, which could potentially cause a slight supply crunch and lead to higher aluminium prices in the coming weeks.